Nov. 2 (Bloomberg) -- U.S. stocks slipped, trimming a
weekly gain, after growing payrolls failed to extend yesterday’s
rally as Americans prepared to pick a president and assessed
damage from Hurricane Sandy. Treasuries pared early losses while
the dollar extended gains against the euro.

The S&P 500 lost 0.9 percent to 1,414.19 at 4 p.m. in New
York after surging 1.1 percent yesterday. Ten-year Treasury
yields fell less than one basis point to 1.72 percent after
climbing five points earlier. The dollar rose against all but
three of its 16 major peers, climbing 0.9 percent to an almost
one-month high of $1.2832 per euro. Oil lost 2.6 percent to
$84.86 a barrel after Sandy shut down East Coast refineries.

The S&P 500 reversed a 0.5 percent advance after it topped
1,434, nearing a level watched by traders because it is the
average price over the last 50 days. A net 171,000 workers were
added to payrolls last month and September’s gain was more than
first estimated, the Labor Department said. The increase
surpassed the most optimistic forecast in a Bloomberg survey in
which the median called for an advance of 125,000. Unemployment
rose to 7.9 percent as more people entered the labor force.

“When the market gets to the top of the trading range, the
good news is not good enough,” Wayne Wilbanks, chief investment
officer at Wilbanks, Smith & Thomas Asset Management LLC in
Norfolk, Virginia, which oversees $2.2 billion, said in a phone
interview. “All eyes are on the election and beyond. The two
presidential candidates haven’t had an honest discussion with
America about the pain and suffering that’s involved with
balancing the budget. All you have to do is look at Europe.”

Dead Heat

As the 2012 campaign reached its final weekend, Republican
nominee Mitt Romney argued for a change from President Barack
Obama’s economic policies, while the incumbent said the
challenger’s proposals were those that led to the economic
downturn in the first place.

The candidates, locked in a race that opinion polls call a
dead heat, made their contrasting arguments in dueling CNN
opinion pieces. Election Day is Nov. 6.

Stocks have on average rallied 3 percent in the two months
following Election Day after a tight race, according to Thomas
J. Lee, the chief U.S. equity strategist at JPMorgan Chase &
Co., who cited historical data from the last five elections with
close contests. The equity market rallies even more if the
challenger wins, he said.

‘Holding Back’

“The uncertainty about who’s going to be our president,
regardless of who it is, has been holding back investor
conviction,” New York-based Lee said in a Bloomberg Radio
interview today. “People just aren’t holding large positions.
Once we get through Election Day, we should really start to see
money put to work.”

Stocks also erased gains earlier as results from Chevron
Corp., American International Group Inc. and Newmont Mining
Corp. disappointed investors and commodity prices fell.

AIG, the insurer that counts the U.S. as its largest
shareholder, sank 7.2 percent as premium revenue slipped at its
main units.

Gauges of raw material and energy producers declined at
least 1.7 percent to lead declines among all 10 of the main
industry groups in the S&P 500, which trimmed its weekly advance
to less than 0.2 percent. Exchanges were shut for the first two
days of the week for Hurricane Sandy, the longest weather-related closings in the U.S. since 1888.

Oil in New York fell for the first time in four days.
Copper dropped in New York, heading for a fourth straight weekly
decline, as inventories tracked by the Shanghai Futures Exchange
reached a six-month high, figures showed today.

European Markets

The Stoxx 600 climbed 1.6 percent this week. Beiersdorf AG,
the maker of Nivea skin cream, rose 7.2 percent to the highest
since at least 1996 as the company raised its forecast for sales
growth and reported third-quarter profit that beat estimates.
Alcatel-Lucent SA sank 5.5 percent today after the French phone-equipment maker swung to a loss in the third quarter.

Greece’s ASE Index rose 5.4 percent, trimming this week’s
decline to 8.3 percent. The nation’s shares have tumbled as
coalition government lawmakers squabble over austerity that a
Bundesbank official warned must be enforced to ensure the
country receives international bailout funds.

European Manufacturing

A gauge of manufacturing in the euro area fell to 45.4 from
46.1 in September, Markit Economics said. That compares with an
initial estimate of 45.3 published on Oct. 24. A reading below
50 indicates contraction.